2019 (1) TMI 619 - HC - Central Excise

Principles of natural justice - though the respondents issued notice for personal hearing, the first respondent has not given an opportunity of personal hearing to the petitioners and without their consent passed impugned order - Held that - When the personal hearing could not be held due to administrative reasons, the first respondent ought to have passed the impugned order, after providing such opportunity to the petitioners. But, in violation of the principle of natural justice, the first respondent has passed the impugned order. As there is a clear violation of the principles of natural justice, this Court is inclined to set aside the impugned order. The matter is remanded back to the file of the first respondent to proceed from the stage of personal hearing - petition allowed by way of remand.

Summary

Issues:
Challenging order directing payment of duty without personal hearing.

Analysis:
The writ petitions were filed challenging an order directing the petitioners to pay their respective duty without providing a personal hearing. The petitioners, who were manufacturers of matches, were issued show cause notices regarding Central Excise Duty on machine-made matches manufactured and cleared without payment of duty. Despite submitting replies and a notice for personal hearing, the impugned order was passed hurriedly without granting an opportunity for personal hearing, leading to the petitioners approaching the court.

The main contention of the petitioners was the lack of personal hearing before the order was passed. The petitioners argued that the order should be quashed as the first respondent did not provide an opportunity for personal hearing and erroneously mentioned in the order that the matter was discussed with counsel and oral consent was obtained. This was viewed as a violation of the principle of natural justice, necessitating the setting aside of the impugned order and a potential remand of the matter.

Upon examination, the court noted that the first respondent had admitted in the impugned order that the personal hearing could not be held on the scheduled date due to administrative reasons. Despite this, the order was passed without affording the petitioners the necessary opportunity. Recognizing the clear violation of natural justice principles, the court decided to set aside the impugned order and remand the matter back to the first respondent for proper adjudication, starting from the stage of personal hearing.

In conclusion, the court set aside the impugned order and directed the first respondent to conduct a personal hearing, following specific guidelines and legal precedents. The first respondent was instructed to issue a notice fixing the date for personal hearing and to pass appropriate orders on merits and in accordance with the law after providing sufficient opportunity to the petitioners. The court mandated the completion of this process within eight weeks and emphasized the need for cooperation from the petitioners. The writ petitions were disposed of with no costs, and connected miscellaneous petitions were closed accordingly.